Schools have $5M problem for 2010

Thursday

Oct 2, 2008 at 2:00 AMOct 2, 2008 at 10:20 PM

As the Barnstable School Committee contemplates its FY2010 budget, it does so knowing that it has to find $5 million in revenues or cuts to make it work.

Situation critical for FY’10 budget As the Barnstable School Committee contemplates its FY2010 budget, it does so knowing that it has to find $5 million in revenues or cuts to make it work. Barnstable Schools Superintendent Dr. Patricia Grenier told the committee Tuesday night that the district entered FY10 into budget planning with the mindset that they would still be able to rely upon the “free cash” revenues the district has used in the past. “The average amount of money used from the savings account from the past six years was $2 million. $1 million was reserved in the savings account to be added to the $2 million in excess,” said Grenier at the Sept. 30 school committee meeting. “We went into the mindset of FY10 thinking, ‘We’ll have that $3 million to add to our recurring revenue.’ That did not happen.” Grenier noted that this year’s budget is $60.8 million. To maintain level service – keeping all school programs as they are now – the school district would require a FY’10 budget of $64.3 million. Grenier explained that the school district expected it would have $3 million in their savings, or “free cash” account, based on past usage trends. “[Town Finance Director] Mark Milne informed me the other day that there is zero additional revenue,” she said. “The only amount of money in free cash is the money the school committee reserved last year, and that’s $1 million.” Grenier said Milne projected the schools might get approximately $1.2 million in new growth, but retracted that projection after reports revealed a state budget shortfall of $1.5 billion. “Based on what the state released, that they are $1.5 billion short, [Milne] can no longer support his new growth revenue source, or the recurring revenue,” said Grenier. “There is a culture of dependency on the savings account, or free cash funds, to balance the school budget. The problem with that is you can’t always expect it to be there.” Grenier stated that the district was perhaps lulled into a false sense of security regarding the “free cash.” “The bottom line certainly is one that causes us to put into place a pretty substantial action plan for the development of our budget for next year,” she said. “Whether it’s a blue ribbon committee, or another form of committee, I think we need a very serious action plan.” Calling the news “startling,” Grenier said that the school committee is still absorbing the impact and has yet to decide what steps to take, though she plans to readdress the matter at the Oct. 21 meeting. “This is really quite startling. If in fact we needed level service – the same programs and services next year that we have this year – and knowing that if we lost 100 students it doesn’t allow us to cut 100 teachers, we would need $64 million,” she said. “We will have about $59 million. We will be approximately $5 million short of funding the budget for the schools. $5 million would mean roughly cutting 100 teachers in Barnstable.” Other school committee members, including committee chairman Ralph Cahoon, echoed Grenier’s concerns. “I’ve been having major headaches every night thinking about this. The interest income that has been regularly available and that both the municipal and the school side have been using is gone,” he said. “We have no control over the economy and it’s not going to get any prettier in the near future, so we’re going to have to deal with this and we will.” Cahoon noted that many of the expenses the district faces are out of its control, such as special education mandates, heat and electricity. Nonetheless, he acknowledged that the budget situation was dire. “It’s going to be painful,” he said. “People are going to have to be expecting that there are going to be some major modifications made in how we do business next year.” In attempting to figure out how to navigate the muddy budgetary waters, Grenier said that everything would be taken into consideration including bus fees, athletic fees, school closures and consolidation, and staff reductions. “Well, that’s the bad news. Where’s the good news?” asked Cahoon to lighten the mood. “”There’s lots of good news of great things happening in the schools,” said Grenier. “[It] makes me sick to my stomach a little bit because there are so many good things happening in the schools that I don’t even know how to envision a school district $5 million short of what we have today.” Tom Dolby, who ran for a seat on the school committee in 2007, expressed concern about the issue during public comment. “Several weeks ago the town manager made a presentation to the town council stating that the town would have a $2.5 million structural deficit for the next fiscal year and there would be no more free cash available to the schools or town for fiscal year 2010,” he said. Dolby, a Marstons Mills resident and former school committee chairman, noted that since 2004 the district has used approximately $12 million in “free cash.” Now that those funds had dried up, Dolby asked the committee what plans were for FY’10. “The establishment of a blue ribbon committee of Barnstable residents to assist the school committee would go a long way toward helping solve this crisis,” he said.

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